Steel producers have urged the government to provide them export incentives to help overcome the current downturn within the industry. They have argued that that imposition of countervailing duties (CVD) by the US and European authorities coupled with surge in the metals imports have triggered serious concerns within the domestic industry.
At a recent meeting convened by steel secretary DRS Chaudhary,the countrys leading steel manufacturers said the US and European nations have imposed CVD to insulate their respective steel industries from overseas competition,while imports of the metal have surged in India by 150-200 per cent as has been stated by the ministrys Joint Plant Committee (JPC).
They also expressed apprehension that Indias steel imports may go up to 50 million tonne (MT) from the current 8 MT to make up for the anticipated 200 million tonne demand by 2020,steel ministry sources said. Participating in the meeting,Essar Steels director for marketing Vikram Amin said the CVDs have limited Indias ability to export to these nations resulting which the domestic demand-supply situation will determine the trend in local steel prices.
The representative of another major producer,JSW,contended that the volatility in the rupee against the US dollar has further squeezed the prospects of the Indian companies to export and major markets like the EU are now no longer a feasible option.
There is a need for giving export incentives to domestic steel makers on the lines of export incentives (up to 30 per cent) being extended by the Chinese government to its steel industry, the companies argued. Executive secretary of the JPC,GK Basak,endorsed the contention of the producers that steel imports have surged especially from South Korea and Japan and argued that most of it is happening due to price considerations.
SAIL has expressed concern on the dipping domestic demand due to slow growth in sectors like automobile,manufacturing and immense competition in the domestic market due to over capacity and rising costs, ministry sources said. Acting on the steel ministrys recommendation,the finance ministry had upped the import duty to 7.5 per cent from 5 per cent.
Steel producers have argued that that imposition of countervailing duties by the US Europe coupled with surge in the metals imports have triggered concerns within the domestic industry
They say that steel imports may go up to 50 MT from the current 8 MT to make up for the anticipated 200 million tonne demand by 2020
The finance ministry had already upped the import duty to 7.5 per cent from 5 per cent